Bulls chase as NovaGold runs

Comment

Shutterstock photo

NovaGold has been running, and the bulls are giving chase.

optionMONSTER's Heat Seeker monitoring program detected the purchase of almost 4,500 June 3.50 calls for $0.85 to $0.90. Volume was more than 6 times previous open interest at the strike, indicating that new positions were initiated.

These long calls lock in the price where a stock can be bought, letting investors profit from a rally at low cost. Today's transaction is noteworthy because it is using in-the-money contracts, which will closely track movements in the underlying shares. (See our Education section)

While the broader gold-mining industry is up 19 percent in the last three months, NG has thoroughly outperformed its peers with a 73 percent over that same period. It's up another 1.74 percent to $4.10 in afternoon trading today.

Total option volume in NovaGold is more than triple the daily average, with calls outnumbering puts by a bullish 58-to-1 ratio.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.



This article appears in: Investing , Options


More from optionMONSTER

Subscribe






optionMONSTER
Contributor:

optionMONSTER

Options
Follow on:

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com